Huge project unveiled to boost growth

STIMULUS The NT$500bn package will create jobs and revive the economy, the Cabinet says, but it must still get the approval of a skeptical legislature

By Ko Shu-ling / STAFF REPORTER

Premier Yu Shyi-kun, right, together with other Cabinet members unveils a five-year, NT$500 billion public construction package at a press conference yesterday.

PHOTO: SEAN CHAO, TAIPEI TIMES

The government yesterday unveiled its five-year, NT$500 billion public construction package that aims to raise the nation's competitiveness ranking to third in the world, boost economic growth and create jobs.

The package, which includes the construction of artificial lakes and mass rapid transit systems and increased spending on higher education, will conclude with an exposition to coincide with the Beijing Olympics in 2008.

According to a World Economic Forum (WEF) survey of 102 countries, Taiwan ranked fifth in terms of competitiveness, the highest in Asia, up from sixth last year.

The Cabinet is scheduled to approve the project during its weekly closed-door Cabinet meeting tomorrow.

With the implementation of the five-year plan, Premier Yu Shyi-kun said that the government hopes to boost the nation's annual economic growth by an average of 1.03 percentage points and create an average of 64,000 jobs each year.

Responding to the opposition's threat to boycott the project in the legislature, Yu said that he is confident legislation for the project and its budget will be approved.

"I don't mind bowing to opposition lawmakers in exchange for the swift passage of the special bill and budget, although I won't kneel down," Yu said, mocking People First Party (PFP) Chairman James Soong, who recently knelt before Yunlin County Commissioner Chang Jung-wei (張榮味) to apologize for the central government's rejection of a budget request.

Yu also dismissed speculation that the plan is aimed at garnering votes in next March's presidential election.

"We've been working on the project for the past six months, and we hope the legislature will give it the go-ahead by the end of the year so we'll be able to begin the plan in earnest on Jan. 1 next year as planned," Yu said. "The project would still be desperately needed even if there were no election next year."

The 10 projects

Research (NT$50 billion)

1. The Cabinet hopes to see at least 15 universities or research institutions places first among Asia’s top research institutions within five years. The government also expects to see at least one university ranked in the world’s top 100 universities within 10 years.

Culture and creativity (NT$100.6 billion)

2. NT$33.4 billion is earmarked for the construction of museum, art centers, cultural parks and concert halls across the nation.

3. The NT$37 billion M-Taiwan project seeks to build a 6,000km broadband network for the country.

4. NT$30.1 billion will be spent on the Taiwan Exposition in 2008.

International competitiveness (NT$107.9 billion)

5. The Cabinet plans to spend NT$39.9 billion to upgrade eight segments of the railway system and build three new express extension lines.

6. Eastern Taiwan will have its first freeway in the NT$43.9 billion third-wave freeway project.

8. The 182km of mass rapid transit systems in northern, central and southern Taiwan are estimated to cost NT$142 billion.

9. A NT$39.4 billion expansion of the sewerage system seeks to increase the proportion of the population connected to it from this year’s 10.7 percent to 27.3 percent in 2008.

10. Artificial lakes in Taoyuan, Yunlin, Tainan and Kaohsiung counties and desalination facilities in the industrial park in Hsinchu and on the offshore islands of Kinmen, Matsu and Penghu are estimated to cost NT$31.5 billion.

Graphic :TT

The Cabinet plans to borrow NT$500 billion in a special budget to exempt it from limits on the amount the government can borrow. The government is also hoping to attract NT$203 billion from the private sector and NT$131.6 billion from local governments that, combined with other sources, would make the project worth more than NT$948 billion.

In response to skepticism over the government's intention to dodge borrowing limits to fund the project, Yu said that borrowing money was not the problem.

"What they should have focused on is whether we have the ability to pay back the loan," Yu said. "It makes perfect sense to me to borrow money now and let our children pay back the money while they're enjoying the fruits of our labor."

Besides, he said, the nation's financial situation was considered "stable" compared with other developed countries.

"While our central and local government debt combined takes up 34 percent of our GDP, that of the UK accounts for 50 percent of its GDP, that of the US 61 percent, Germany 62 percent, Canada 80 percent and Japan 147 percent," he said.

Yu also confirmed media reports that President Chen Shui-bian (陳水扁) has expressed his wish to "rely on Yu" if he is re-elected next March.

"The president has voiced his recognition and appreciation of the Cabinet's efforts over the past 21 months and I've relayed the president's words to my colleagues during one of the weekly Cabinet meetings," he said.